Paytm’s shares surged to a new 52-week high following a bullish upgrade from Bernstein, driven by positive broker sentiment, potential monetisation benefits from India’s payment reforms, and improving quarterly financials amid growing regulatory clarity.
Paytm’s shares surged to a fresh 52-week high on Monday after Bernstein turned more constructive on the fintech company, lifting its rating to “Outperform” and raising its target price to ₹2,200 from ₹1,500. The broker’s new valuation implies significant further upside and reflects growing confidence that changes in India’s payments framework could unlock a new revenue stream for the company.
The rally added to a broader run of positive broker commentary around One 97 Communications, Paytm’s parent. Goldman Sachs recently lifted its target price on the stock on improved growth visibility, while UBS and Jefferies have also pointed to better regulatory clarity, stronger operating leverage and a clearer path to profitability. Bernstein’s latest note is the most bullish of the group, with the firm now assuming that UPI merchant discount rate, or MDR, monetisation becomes part of its base case from FY28.
That assumption matters because UPI has long been free for consumers and person-to-person transfers, but the government has recently moved to clarify that any MDR would, if introduced, apply only to a narrow set of merchant transactions. Bernstein believes such a change could lift Paytm’s net payments margin by 3 to 4 basis points and add about ₹2,200 crore to EBITDA by FY30, which in turn could increase FY30 earnings per share by 30% versus its earlier forecast.
The market’s enthusiasm also reflects Paytm’s improving quarterly numbers. In Q1 FY27, the company reported a 79% rise in consolidated net profit to ₹220 crore, while operating revenue climbed 28% to ₹2,448 crore. EBITDA rose sharply to ₹203 crore and the margin improved to 8% from 4% a year earlier, helping to fuel a further re-rating in the stock after the results were published in July.
Even so, Bernstein cautioned that competition among payment platforms could limit how much of any future MDR Paytm is able to keep. Still, with the stock already well above its recent levels and several brokerages now more optimistic on the company’s earnings trajectory, investors appear to be betting that Paytm’s recovery is becoming more durable.
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